Wonderla Holidays Pvt Ltd, which runs two amusement parks and one resort in the country, is looking to raise over Rs 178 crore ($32.9 million) through an initial public offering (IPO). The public issue will be the biggest in the hospitality sector since Mahindra Holiday & Resorts floated its IPO in mid-2009.

The company is looking to issue 1.45 million shares in the issue constituting some 25.66 per cent of the diluted capital base, as per its DRHP filed with SEBI. It is raising capital to build a new amusement park in Hyderabad, which requires an investment of Rs 250.7 crore.

Wonderla has already invested Rs 22.6 crore for this and hopes to raise at least Rs 178 crore through the IPO, with the rest being raised through debt.

This means the firm is eyeing a market value of over Rs 700 crore. It had earned revenues of Rs 109.8 crore with net profit of Rs 29 crore for the nine months ended December 31, 2012.

Over the past few years, the company saw positive growth in its revenue and profit margins. It clocked revenues of Rs 69.7 crore in FY11, which rose to Rs 91.2 crore in FY12 and Rs 114.5 crore in FY12.

Promoted by Kochouseph Chittilappilly and his son Arun Chittilappilly, Wonderla started its first amusement park in Kochi in 2000 and the second unit in Bangalore in 2005, following which it started its first resort.

This will the second firm of the promoters to go public. They had previously taken V-Guard Industries Ltd to the market. V-Guard, which counts Nalanda Capital as a large institutional shareholder, manufactures voltage stabilisers, pumps & motors, electric water heaters, solar water heaters, cables, UPSs and ceiling fans.

Edelweiss and ICICI Securities are the book running lead managers to the IPO.